Rupert Murdoch's BSkyB has been barred from taking over one of Europe's largest clubs, Manchester United.

The Department of Trade and Industry reached its decision despite hard lobbying from BSkyB in recent days during which it made pledges that it would not abuse its position when negotiating television rights for football.

It was last October that BSkyB bid £623m for the Manchester United. This was accepted by the club's board but some fans and MPs protested against the move.

It was referred to the then competition watchdog, the Monopolies and Mergers Commission(MMC).

BSkyB currently broadcasts live Premiership football in the UK in an exclusive deal.

Had this takeover been allowed it would also have owned the biggest club in the land and sat on both sides of the negotiating table.

When the decision was announced, Manchester United's shares dropped 32.5p to 186p on the London stock market, a fall of almost 15%. It wiped £85m off the value of the company.

Anti-competitive

The Department of Trade and Industry said Mr Byers was acting on the recommendation of the MMC which delivered its report on the proposed takeover last month.

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Mr Byers said the MMC report concluded the takeover would have reduced competition for the broadcasting rights to Premier League matches.

"I agree with the MMC that the advantages which ownership of Manchester United would give BSkyB over other broadcasters in future sales of Premier League broadcasting rights would substantially increase its chances of winning
those rights," said Mr Byers.

He also agreed with the MMC that the takeover would have damaged the sport of football.

"I accept their conclusions that the merger would damage the quality of British football by reinforcing the trend towards growing inequalities between the larger richer clubs and the smaller, poorer ones and by giving BSkyB additional influence over Premier League decisions about the organisation of football leading to some decisions which would not reflect the game's long term interests."

Sick as a parrot

Within minutes Manchester United issued a statement. It said: "Although disappointed by this
decision, the board is confident that Manchester United will maintain its record of success."

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Naturally, BSkyB said it was disappointed. BSkyB's chief executive Mark Booth continued: "This ruling sets an unfortunate precedent for other British clubs and companies who may have wanted to work together to improve and invest in the
future of football, for the benefit of clubs, players and fans alike.

"This is a bad ruling for British football clubs who will have to compete in Europe against clubs who are backed by successful media companies.

Over the moon

This disappointment was not reflected among some fans though. Chairman of the Manchester United Independent Supporters' Association, Andy Walsh, said: "It is a tremendous victory for supporters of Manchester United and for all football club fans.

"The news is fantastic and follows seven months of hard work. This
is great for us and for anyone fighting for the independence of their club."

Michael Crick, of Shareholders United Against Murdoch added: "It is a victory for football, a victory for broadcasting and a victory for the ordinary fan.

"The MMC and the government have established the principle not just that Rupert Murdoch should not own United but that no other TV company should own a major football club either."

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The BBC's John Thorne at Old Trafford: Ordinary fans love the club whoever owns it